The November U.S. employment report is set to showcase a labor market that’s healthy enough for the Federal Reserve to raise interest rates later this month. But President-elect Donald Trump may still find it a “disaster.”
Employers added 180,000 workers, accelerating hiring from 161,000, and the unemployment rate held at an eight-year low of 4.9 percent, according to the median estimate of economists surveyed by Bloomberg ahead of Friday’s release from the Labor Department.
Wage growth probably remained at a seven-year high.
The payrolls report is the last one before the Fed’s December meeting. While investors see an interest-rate increase as a certainty, policymakers will be looking for affirmation the job market is humming along.
At the same time, Trump will have a chance to reconsider — or repeat — his characterization of the employment picture as an “economic disaster,” citing figures such as the number of prime-age Americans outside the labor force.
Trump “could play it both ways,” Gregory Daco, head of U.S. macroeconomics at Oxford Economics Ltd. in New York. For those who aren’t working or lost their jobs but only found lesser-paying work, the president-elect would reiterate that the economy and labor market are doing poorly. On other data points, such as wages that are perking up, “Trump could say that things will only get better under him.”
The billionaire real estate developer said during the campaign that his policies would create 25 million jobs in a decade, with tax cuts and infrastructure spending fueling growth. His Treasury secretary nominee, Steven Mnuchin, on Wednesday said good jobs and wage increases for the average American worker are “the priority of this administration.”
Some weak spots remain. Economists will watch the participation rate, which indicates the share of working-age people who are employed or looking for work. It fell in October and is near the lowest level since 1978, with the longer-term slide mainly due to retiring baby boomers.
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Trump has pointed to the many Americans who remain outside the workforce, as well as a broader measure of unemployment, which has made meager progress this year.
“He has focused on the pockets of weakness, not on the broader job market strength,” said Mark Zandi, chief economist at Moody’s Analytics Inc. in West Chester, Pa. “There’s some reason to be cautious, but there’s no reason to be dark or pessimistic about things. That just doesn’t fit with the data.”